New business model alert: Lite is dead as freemium comes to iPhone

Apple has announced a change to its terms of service which paves the way for new business models on the iPhone.

Historically, virtual goods could only be purchased in paid apps. That led to a series of anomalies, in particular that developers had to follow an upgrade path of:

Lite version -> paid version -> virtual goods/add-ons

The change is likely to eliminate Lite versions. Developers can offer a single version with a clear upgrade path to new features or content. There are some limitations, though: no virtual currencies and no “rentals” – i.e. if a user downloads content, it can’t be time-limited.

I think we’ll see a lot of changes to the iPhone business models very quickly.

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve: thecurveonline.com

About

Gamesbrief is a blog about the business of games. We look behind the headlines to tell you not just what is happening to games, but why it matters to your business. From Activision to Zynga, we analyse the companies who are making waves in the games industry and the new platforms, like Facebook, iPhone and Unity, that are changing the market.

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